Having a baby is an exciting and life-changing event. Whether it’s your first child or you are growing the pack, there are some basic financial considerations to think about so that you can better provide for your baby as it grows.
1. Create a baby budget
Raising a child is expensive, especially on an Island. As soon as you are pregnant, there are added expenses for medical and prenatal care, maternity clothes and supplies that you will need to support the baby once he or she arrives. Take the time to create a pre- and post-birth baby budget to give you a sense of what you will need to buy and how to budget appropriately. If you are working, speak to your Human Resources department about adding your baby to your health plan.
Consider hand-me down items which can help cut the costs and save you money. While you may have some anxiety about hand-me downs, it is a very common practice in Bermuda. EMoo is a good place to look for second-hand supplies. Also, the Facebook page MAMA Market- Bermuda is dedicated to sharing baby supplies. Remember these sites as your baby grows, as you can post your own goods for sale and pay it forward.
2. Set aside emergency savings
Pregnancy and raising a child do not always go as planned. Even the most prepared parents will face unexpected and challenging moments. These can include among many other things, medical emergencies or the loss of a job and income. To help during these times, we recommend putting aside emergency savings. It is everyone’s hope that you will never need to tap into your emergency savings, but it will offer you peace of mind to have a buffer should you ever need it
3. Start an education fund
Whether you plan to send your little one to public school or private school, there are costs associated with education. These costs accumulate over the years and continue should he or she pursue additional schooling after high school. By starting an education savings fund now, you give yourself and your investment time to grow. Argus has a few videos that show you how an investment grows over time.
4. Update your beneficiaries
If you have a pension plan (which is required by law for every working person in Bermuda), or a will, trust, company or personal life policy, you likely have beneficiaries listed on your account. A beneficiary is the person you select to receive the benefits of your plan in the event of your death. Having a baby is a good time to review your pension plan and beneficiaries and ensure that the list is appropriate for your new family.
5. Set up a life insurance plan
Thinking about death can be a scary, dark thought. However, think of life insurance as a security for your family and loved ones.
Life insurance becomes especially important once you become a parent. A life insurance plan sets aside funds to care for your loved ones in the event of your premature death. Argus offers Individual Life Insurance as well as Group Life Insurance through employers, so be sure to talk to your Human Resources department or your boss to learn about your options. Since group insurance ceases if you become unemployed, it’s a good idea to supplement it with Individual Life Insurance. Argus also offers Life Insurance directly to individuals. For additional help, visit our Frequently Asked Questions page or speak with an Argus representative at 298-0888.
Today is a great day to get started because you will have your hands full once baby arrives. Taking care of these five financial matters now will give you time, energy and the financial wellbeing to focus on what really matters – welcoming your new baby to the world!
By Angela Joell, Education & Investment Manager at Argus Group